Private equity deals not ruled out

GOVERNOR of the Central Bank John Hurley said yesterday that a return to the previous high instances of private equity deals and leveraged buyouts couldn’t be ruled out once global markets return to their normal levels, but that a return cannot be automatically counted on either.

Speaking in Dublin on the opening day of the European Central Bank/Centre for Financial Studies conference on capital markets and financial integration in Europe, Mr Hurley said: “With regard to private equity deals and leveraged buyouts, even though recent market events appear to have halted the dramatic rise in deals, when normal market conditions are restored one wouldn’t prejudge a return to the previous high level of activity.

“A major concern for central bankers and financial regulators in this area is whether the growth in these deals has been accompanied by any significant increase in credit risk for entities such as banks, which are providing significant leverage to private equity deals and funds.”